The people who created HIPAA in the context of the Rules healthcare organizations have to comply with were Donna Shalala and her team at the Department of Health and Human Services. If Donna Shalala is a new name to you, this article explains who she was and her role in the creation of HIPAA.
Donna Shalala is the longest-serving Secretary for Health and Human Services (HHS), having been appointed to the role in 1993 by President Bill Clinton and remaining as head of the Department until 2001. During her tenure, Shalala helped raise child immunization rates to the highest ever, crusaded for better medications and access to medications to fight AIDS, and created national initiatives to tackle breast cancer, racial and ethnic health disparities, and violence against women.
With regards to answering the question who created HIPAA, Donna Shalala worked closely with the Clinton Health Plan Task Force to help develop the ambitious, but ultimately unsuccessful, Health Security Act of 1993, with Senator Ted Kennedy to pass the Organ Transplant Reauthorization Act of 1996, and with Texas House Representative Bill Archer to thrash out compromises in return for support for President Clinton’s Medicare plans. Why these relationships matter is explained below.
The Clinton Health Plan
When President Clinton was elected in 1992, his success was partly attributable to a campaign promise to reform the healthcare system. On taking residency of the White House in January 1993, the President established a task force to work on the health plan; and, in September 1993, the comprehensive Health Security Act was introduced into the Senate.
However, the bill was described by opponents as a “massive top-down, bureaucratic command-and-control system that would meticulously govern virtually every aspect of the delivery and the financing of health care services for the American people” and, because it was considered “too much big government” the bill was declared dead in September 1994.
The Kennedy Connection
Although the Clinton Health Plan was ultimately unsuccessful, many sections of the plan were subsequently introduced as separate Acts. One of these separate Acts was Ted Kennedy’s and Nancy Kassebaum’s Health Insurance Reform Act of 1995, which lifted a number of proposals to reform the health insurance industry out of the Clinton Health Plan.
Although the Health Insurance Reform Act was well received, concerns existed that the cost of compliance would be passed onto employers and employees in the form of higher premiums; and, because health insurance premiums are tax deductible, this would result in a decrease in federal tax revenues. Secretary Shalala estimated that up to 40% of Americans could pay higher premiums.
Bill Archer Plan Adopted
At the same time as the Kennedy-Kassebaum bill was under consideration, Representative Bill Archer had introduced a companion bill into the house which – although not so comprehensive with regards to health insurance reforms – included proposals to reduce the level of healthcare insurance fraud and simplify the administration of health insurance transactions to make them more efficient.
It was decided that, if the health insurance industry could save money through the reduction of fraud and an increase in efficiency, this would negate the cost of compliance and the risk of increased premiums. Consequently, the Kennedy-Kassebaum proposals were integrated into Archer’s proposed Health Coverage Availability and Affordability Act, and the bill became known as the Health Insurance Portability and Accountability Act.
Shalala’s Work Really Begins
Once HIPAA was signed into law in August 1996, Secretary Shalala’s work really began. The text of HIPAA does not include any Privacy or Security Rule standards, but rather instructs Secretary Shalala to make recommendations for the privacy of health information and adopt standards for the security of health information transmitted electronically in covered health insurance transactions.
Secretary Shalala delivered the recommendations within a year; but because Congress had set itself a three year deadline to enact privacy legislation, the recommendations were not published as the Privacy Rule until after the deadline has expired in 1999. The Department also published proposals for the security of health information in 1998; but, due to a lack of readiness by the healthcare and health insurance industries, the proposals were not finalized until 2003.
Who Created HIPAA? Donna Shalala and her Team
Although President Clinton, his task force, Senators Kennedy and Kassebaum, and Representative Archer all had roles to play in the creation of HIPAA, the one constant that was there throughout was Donna Shalala. While she did not single-handedly create HIPAA, Secretary Shalala can be credited with be a driving force behind the Act – both before it was passed and in the development of the Rules healthcare organizations have to comply with.